LG Energy and Toyota Announce Major EV Battery Supply Agreement

By Editor


LG Energy Solution and Toyota Motor North America have joined forces in a significant development for the electric vehicle (EV) market, announcing a comprehensive supply agreement for lithium-ion battery modules intended for Toyota’s battery electric vehicles (BEVs) to be manufactured in the United States.

Starting from 2025, LG Energy Solution will supply automotive battery modules to Toyota with an impressive annual capacity of 20GWh. The battery modules, made up of high-nickel NCMA (nickel, cobalt, manganese, aluminum) pouch-type cells, will be produced at LG Energy Solution’s state-of-the-art facility located in Michigan.

These cutting-edge power solutions are destined to power Toyota’s expanding range of BEVs, in line with their ambitious multi-pathway product strategy. This includes a forthcoming BEV model scheduled for assembly at Toyota Motor Manufacturing Kentucky in 2025. Toyota’s electrification initiatives are poised for a significant boost, aiming to offer 30 BEV models globally under both the Toyota and Lexus brand names, with a production goal of up to 3.5 million BEVs annually by 2030.

Tetsuo “Ted” Ogawa, President and CEO of Toyota Motor North America, emphasized their commitment to rapid carbon emissions reduction: “At Toyota, our goal is to reduce carbon emissions as much as possible, as fast as possible. Having secure supplies of lithium-ion batteries at scale with a long-term relationship to support Toyota’s multi-pathway approach and growth plans for BEVs in North America is critical to achieve our manufacturing and carbon reduction plans.”

To meet the requirements of this significant supply agreement, LG Energy Solution will invest approximately USD 3 billion (KRW 4 trillion) into its Michigan facility, setting up dedicated production lines for battery cells and modules exclusively for Toyota. Completion of this expansion is anticipated by 2025. Initially, the battery modules will be transported to Toyota Motor Manufacturing Kentucky for assembly into battery packs, which will then be integrated into BEVs.

This collaboration brings together LG Energy Solution’s expertise in manufacturing top-quality battery cells and modules at scale and Toyota’s advanced technologies in battery packs. The resulting product will employ LG Energy Solution’s innovative power solution to optimize battery system performance, offering an enhanced customer experience.

Youngsoo Kwon, CEO of LG Energy Solution, expressed enthusiasm for this collaboration: “With our 30 years of experience in lithium-ion batteries, we will provide innovative power solutions to support Toyota’s push further into battery electric vehicles.”

This agreement represents LG Energy Solution’s largest single supply agreement outside of joint ventures. The company now supplies batteries to all top five global automakers, underscoring its market leadership. LG Energy Solution has a robust presence in North America, with eight battery manufacturing facilities either operational or under construction, highlighting their commitment to regional production capacity and electrification progress.

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